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IO4                               SHIPPING PRACTICE

the fact that during times of depression building rates tend

to be lower than in times of boom, and enterprising owners

quick to take advantage of a reduction in building costs

give orders for new vessels to replace old ones which they

may sell, and thus, following the axiom that boom follows

depression, are equipped with a new vessel in readiness for

the time when the return of trade is an acknowledged fact.

Whilst dealing with this point it may be observed that

the very controversial matter of scrapping or selling vessels

when they are replaced has been the topic from time to time

of many discussions in the shipping world. An owner when

he disposes of old tonnage has the alternative of having it

sold as scrap to the shipyards for a few thousand pounds or

receiving a considerably higher figure by sale to foreign

owners.   This increase of income is offset by the fact

that the foreign owner is often quick to use his newly

acquired vessel in opposition to the very owner from whom

he purchased her. If, however, a British owner provides

sufficiently for depreciation in his accounts, there is no

reason why, when a vessel is to be disposed of, she should

not secure more than her book value in the money paid for

her as scrap. By this method the shareholders of the owning

company ane at no disadvantage, and the possibility of

competition by their old vessels is avoided.

To return however, to the estimation of pinning ex-
penses, the main items are fuel and maintenance.

The first point is to ascertain how long the vessel will be
on her trip. This is arrived at by dividing the total distance
by the distance the steamer wfll travel each day, thus
finding the number of days the steamer will be on voyage.
If a steamer is a 10 knot vessel then she should obviously
cover 240 miles per day, but actually a vessel never runs to
the total of this amount, and it is safer to assume that the
nearer estimate would be to multiply the number of knots
by 20 rather than by 24 (hours per day}* Therefore, esti-
mated travelling capacity of a 10 knot steamer per day
would be approximately 200-210 miles per day.
The division of the speed into the total mileage gives the